Published on 26 Oct 05
by WESTERN AUSTRALIAN DIVISION, THE TAX INSTITUTE
This paper focusses on the central role played by PE in Australian international tax law, including:
- the impact for Australian businesses operating offshore through a PE, including the ability of foreign countries to tax the PE operations, the ability to claim foreign tax credits in Australia for foreign taxes as well as recent changes to the Australian tax treatment of foreign branch income and the quarantining of foreign source deductions
- what is required for an overseas entity to have a taxable Australian PE under Australian domestic law and as a result of various tax treaties entered into with other countries
- if a PE exists, what does it mean for the overseas entity (ie registering for income tax, lodging income tax returns etc), non-resident contractors etc.
- the interaction between Australian domestic tax law and tax treaties, including a detailed discussion of recent case law and the varying implications depending upon the country of residence of the overseas entity.